中国联通(00762) - 2024 - 中期财报

Revenue and Profit Growth - Service revenue reached RMB 175.7 billion, up 2.7% year-on-year[4] - Total revenue increased to RMB 197.3 billion, a 2.9% year-on-year growth[4] - Net profit attributable to equity holders rose to RMB 13.8 billion, an 11.3% year-on-year increase[4] - Revenue for the first half of 2024 reached RMB 197.34 billion, a year-on-year increase of 2.9%[14] - Net profit attributable to equity holders was RMB 13.79 billion, up 11.3% year-on-year[14] - Total operating revenue for the first half of 2024 reached RMB 197.34 billion, a year-on-year increase of 2.9%, with service revenue accounting for RMB 175.66 billion, up 2.7%[15] - Pre-tax profit for the first half of 2024 was RMB 16.92 billion, a 10.4% increase year-on-year, with net profit attributable to equity holders reaching RMB 13.79 billion, up 11.3%[22][24] - Revenue increased to RMB 197,341 million in the first half of 2024, up from RMB 191,833 million in the same period of 2023, representing a growth of 2.9%[28] - Net profit attributable to equity holders of the company rose to RMB 13,793 million in H1 2024, compared to RMB 12,391 million in H1 2023, an increase of 11.3%[28] - Basic earnings per share increased to RMB 0.45 in H1 2024 from RMB 0.40 in H1 2023, reflecting a 12.5% growth[28] - Total comprehensive income for the period rose to RMB 14,062 million in H1 2024, up from RMB 13,002 million in H1 2023[29] - Total comprehensive income for the first half of 2024 was RMB 14,062 million, compared to RMB 13,002 million in the same period of 2023[33] - Net profit attributable to equity holders of the company for the six months ended June 30, 2024, was RMB 13,793 million, an increase from RMB 12,391 million in the same period in 2023[62] - Basic/diluted earnings per share for the six months ended June 30, 2024, were RMB 0.45, up from RMB 0.40 in the same period in 2023[62] - The company reported a pre-tax profit of 16,919 million RMB in 2024, up from 15,320 million RMB in 2023, reflecting improved profitability[57] EBITDA and Financial Performance - EBITDA stood at RMB 55 billion, up 2.7% year-on-year[4] - EBITDA for the first half of 2024 was RMB 55.01 billion, a 2.7% increase year-on-year, with the EBITDA-to-service revenue ratio remaining stable at 31.3%[25] User and Connectivity Growth - Mobile users increased by over 6 million, reaching a total of 340 million[5] - IoT connections exceeded 560 million, with broadband users reaching 117 million[5] - 5G package user penetration surpassed 80%, and gigabit broadband user penetration exceeded 25%[5] Cloud and Data Services - Unicom Cloud revenue grew 24.3% year-on-year to RMB 31.7 billion[6] - Data service revenue rose 8.6% year-on-year to RMB 3.2 billion, with strong growth in government and enterprise data platforms[7] - Internet communication business revenue grew to RMB 125.06 billion, a 2.1% increase year-on-year, while computing and digital intelligence business revenue rose to RMB 43.54 billion, up 6.6%[17] - Data and internet application services revenue increased to RMB 51.971 billion for the six months ended June 30, 2024, up from RMB 47.752 billion in the same period in 2023[44] International Business - International business revenue increased by 8.4% to RMB 6 billion, driven by IoT and roaming services[8] R&D and Innovation - R&D investment increased by 13% year-on-year in the first half of the year, focusing on network, data, and intelligence innovations[10] - The company achieved 10 EFLOPS of AI computing power and deployed over 20 large-scale computing center parks[11] - Research and development expenses tax deductions amounted to 731 million RMB in 2024, up from 610 million RMB in 2023, supporting innovation efforts[57] Network Infrastructure - 5G mid-frequency base stations exceeded 1.31 million, and low-frequency base stations reached 780,000 in the first half of the year[11] - Fixed asset investment in the first half of the year was RMB 23.9 billion, with a total planned investment of no more than RMB 65 billion for the year[13] - Capital expenditures for the first half of 2024 totaled RMB 23.9 billion, with free cash flow after capital expenditures reaching RMB 5.39 billion[26] - Total capital commitments for telecommunications network construction amounted to RMB 76.427 billion as of June 30, 2024, slightly down from RMB 77.404 billion as of December 31, 2023[119] Environmental and Social Responsibility - The company reduced greenhouse gas emissions by approximately 6.78 million tons in the first half of the year[12] - The energy consumption per unit of telecom business decreased by 6% year-on-year[12] - The digital village platform now covers over 250,000 administrative villages[12] Financial Position and Assets - Total assets as of June 30, 2024, increased to RMB 667.74 billion, while total liabilities decreased to RMB 303.67 billion, resulting in a debt-to-capital ratio of 10.8%, down from 11.6% at the end of 2023[27] - Total assets grew to RMB 667,740 million as of June 30, 2024, up from RMB 661,051 million at the end of 2023[30] - Fixed assets decreased to RMB 348,616 million as of June 30, 2024, compared to RMB 355,995 million at the end of 2023[30] - Cash and cash equivalents stood at RMB 45,839 million as of June 30, 2024, down from RMB 47,733 million at the end of 2023[30] - Total equity increased to RMB 364,071 million as of June 30, 2024, up from RMB 353,898 million at the end of 2023[31] - Total liabilities decreased to RMB 303,669 million as of June 30, 2024, compared to RMB 307,153 million at the end of 2023[32] - Total equity increased to RMB 364,071 million as of June 30, 2024, up from RMB 353,898 million at the beginning of the year[33] - Cash and cash equivalents decreased by RMB 1,917 million in the first half of 2024, ending at RMB 45,839 million[34] - Total assets minus current liabilities increased to RMB 403,850 million as of June 30, 2024, from RMB 397,399 million at the end of 2023[32] - The company's total equity attributable to equity holders increased to RMB 361,590 million as of June 30, 2024, from RMB 351,474 million at the beginning of the year[33] - Fixed assets increased to RMB 1,010,454 million as of June 30, 2024, compared to RMB 996,440 million at the beginning of the period[63] - Right-of-use assets increased by RMB 4.929 billion for the six months ended June 30, 2024, compared to RMB 5.418 billion in the same period in 2023[66] - Financial assets measured at fair value totaled RMB 23,348 million as of June 30, 2024, down from RMB 29,645 million as of December 31, 2023[67] - Accounts receivable increased to RMB 83,492 million as of June 30, 2024, from RMB 57,349 million as of December 31, 2023[71] - Credit loss allowance for accounts receivable increased to RMB 25,920 million as of June 30, 2024, from RMB 18,657 million as of December 31, 2023[71] - Intangible assets decreased to RMB 16,995 million as of June 30, 2024, from RMB 18,265 million as of December 31, 2023[70] - Prepaid transmission line and circuit usage fees decreased to RMB 1,240 million as of June 30, 2024, from RMB 1,601 million as of December 31, 2023[70] - Other assets totaled RMB 21,026 million as of June 30, 2024, down from RMB 22,535 million as of December 31, 2023[70] - Accounts receivable increased significantly from RMB 38,692 million as of December 31, 2023, to RMB 57,572 million as of June 30, 2024, with the largest increase in the "over three months to one year" category, rising from RMB 15,024 million to RMB 22,442 million[72] - Prepaid expenses and other current assets decreased from RMB 26,208 million as of December 31, 2023, to RMB 20,635 million as of June 30, 2024, with a notable reduction in buyback financial assets from RMB 5,005 million to zero[74][75] - The company's total financial assets as of June 30, 2024, were RMB 160.349 billion, slightly down from RMB 161.279 billion as of December 31, 2023[86] - The fair value of equity investments measured at fair value through other comprehensive income (non-reversible) was RMB 2,138 million in Level 1 and RMB 98 million in Level 3, totaling RMB 2,236 million[95] - The fair value of financial assets measured at fair value through profit or loss was RMB 2,816 million in Level 1 and RMB 1,257 million in Level 3, totaling RMB 4,073 million[95] - The fair value of debt investments measured at fair value through other comprehensive income (reversible) was RMB 17,039 million, all in Level 1[95] - The total fair value of financial assets measured at fair value was RMB 23,348 million, with RMB 21,993 million in Level 1 and RMB 1,355 million in Level 3[95] - The fair value of equity investments measured at fair value through other comprehensive income (non-reversible) decreased to RMB 1,929 million in Level 1 and increased to RMB 113 million in Level 3, totaling RMB 2,042 million[96] - The fair value of financial assets measured at fair value through profit or loss decreased to RMB 2,443 million in Level 1 and RMB 1,270 million in Level 3, totaling RMB 3,766 million[96] - The fair value of debt investments measured at fair value through other comprehensive income (reversible) increased to RMB 23,837 million, all in Level 1[96] - The total fair value of financial assets measured at fair value increased to RMB 29,645 million, with RMB 28,209 million in Level 1 and RMB 1,383 million in Level 3[96] - The fair value of long-term bank loans and amounts due to the ultimate holding company was RMB 1,177 million and RMB 855 million, respectively, as of June 30, 2024[100] Costs and Expenses - Operating costs for the first half of 2024 were RMB 184.69 billion, a 2.2% increase year-on-year, with the cost-to-revenue ratio decreasing from 94.2% to 93.6%[18][19] - Network, operation, and support costs for the six months ended June 30, 2024, were RMB 30.448 billion, with network, housing, equipment, and facility usage fees accounting for RMB 11.333 billion[46] - Employee compensation and benefits expenses for the six months ended June 30, 2024, were RMB 28.711 billion, with wages and salaries accounting for RMB 20.053 billion[48] - The cost of sales for communication products for the six months ended June 30, 2024, was RMB 21.153 billion, with mobile phones and other communication products accounting for RMB 20.822 billion[49] - Expected credit loss impairment increased to 7,235 million RMB in 2024 from 3,244 million RMB in 2023, reflecting a significant rise in credit risk[51] - Service technology support costs rose to 27,474 million RMB in 2024, up from 25,828 million RMB in 2023, indicating higher operational expenses[51] - Total financial expenses decreased to 907 million RMB in 2024 from 1,005 million RMB in 2023, primarily due to lower interest expenses[52] - Government subsidies increased to 661 million RMB in 2024 from 344 million RMB in 2023, reflecting higher support from authorities[53] - Income tax expense rose to 3,083 million RMB in 2024 from 2,820 million RMB in 2023, driven by higher taxable profits[56] - Deferred tax assets increased to 2,667 million RMB in 2024 from 1,505 million RMB in 2023, indicating higher future tax benefits[59] - The company's subsidiaries in Mainland China enjoy a preferential tax rate of 15% for high-tech enterprises, contributing to tax savings[58] - Unrecognized deferred tax assets for financial assets measured at fair value through other comprehensive income amounted to 9,517 million RMB in 2024[58] Cash Flow and Financing - Net cash inflow from operating activities was RMB 29,289 million for the first half of 2024, down from RMB 38,287 million in the same period of 2023[34] - Net cash outflow from investing activities was RMB 22,754 million in the first half of 2024, compared to RMB 35,257 million in the same period of 2023[34] - Net cash outflow from financing activities was RMB 8,452 million in the first half of 2024, up from RMB 6,176 million in the same period of 2023[34] - The company proposed an interim dividend of RMB 7,591 million for 2024, compared to no interim dividend in 2023[31] - The company declared an interim dividend of RMB 0.2481 per share for 2024, totaling approximately RMB 7.591 billion, compared to RMB 0.203 per share and RMB 6.211 billion for the same period in 2023[79] - Long-term bank borrowings decreased from RMB 1,606 million as of December 31, 2023, to RMB 1,468 million as of June 30, 2024, with a reduction in the portion due within one year from RMB 354 million to RMB 351 million[80][81] - Short-term bank borrowings increased slightly from RMB 681 million as of December 31, 2023, to RMB 691 million as of June 30, 2024, with interest rates ranging from 1.45% to 1.55%[83] - The company's financial assets measured at fair value through other comprehensive income increased by approximately RMB 165 million in the six months ending June 30, 2024, compared to an increase of RMB 266 million in the same period in 2023[87] - The fair value of financial assets measured at fair value through other comprehensive income was approximately RMB 1.948 billion as of June 30, 2024, up from RMB 1.783 billion as of December 31, 2023[87] - The company recognized share-based payment expenses and other reserves of RMB 141 million for the six months ending June 30, 2024, under the second phase of the restricted A-share incentive plan, compared to RMB 142 million in the same period in 2023[91] - A total of 3,411,000 restricted shares under the second phase of the restricted A-share incentive plan were deemed forfeited during the six months ending June 30, 2024, compared to none in the same period in 2023[91] - The company's financial transactions with China Unicom Group and its subsidiaries included RMB 5,400 million in loans provided and RMB 3,400 million in repayments received during the six months ended June 30, 2024[103] - Accounts receivable from China Unicom Group increased to RMB 6.6 billion as of June 30, 2024, up from RMB 4.6 billion as of December 31, 2023[106] - Accounts payable to China Unicom Group and its subsidiaries reached RMB 7.698 billion as of June 30, 2024, with deposit interest rates ranging from 0.42% to 2.75%[107] - Engineering design and construction services expenses with China Unicom Group's associates and joint ventures increased to RMB 1.532 billion in the first half of 2024, up from RMB 1.140 billion in the same period of 2023[110] - Telecommunications value-added services revenue from associates and joint ventures rose to RMB 402 million in the first half of 2024, compared to RMB 190 million in the same period of 2023[113] - The company recognized RMB 2.005 billion in new right-of-use assets for tower assets in the first half of 2024, down from RMB 3.032 billion in the same period of 2023[115] - Accounts payable to tower companies (excluding lease liabilities) decreased to RMB 13.003 billion as of June 30, 2024, from RMB 13.794 billion as of December 31, 2023[117] Corporate Governance and Compliance - The unaudited condensed consolidated interim financial statements were approved by the board of directors on August 15, 2024[121] - Deloitte reviewed the condensed consolidated interim financial statements and found no material misstatements, confirming compliance with Hong Kong Accounting Standard 34[124] - No share options were granted under the 2014 Share Option Plan from its adoption until June 30, 2024, and the plan expired on